Consulting engineers hit hard by MoDOT cutbacks

In a predictable reaction to the failure of Proposition B in August, the Missouri Department of Transportation is pulling up to $40 million worth of road design and consulting contracts on more than 300 statewide projects.

Four projects with contracts totaling $3.2 million in the Springfield area's District 8 will be delayed.

The bulk of cancelled contracts are with Kansas City and St. Louis consulting engineering firms, but a few local firms are experiencing setbacks. Others in the area are gearing up for an expected slowdown in consulting and design work.

MoDOT officials said due to funding cuts of nearly 50 percent from $1.4 billion to $750 million annually contracts for projects that do not have secure funding will be put on hold or canceled. That equals more than 300 projects, which were planned five years out and beyond. Land acquisition for long-term projects also will be suspended. This action will save MoDOT $120 million, which will be invested in existing roads and bridges, according to MoDOT officials.

MoDOT spokesperson Bob Brendel said negotiations are ongoing with the individual firms, and projects halted now may resume later.

"The actual list of impacted projects will change over the next couple of months as these negotiations are completed," he said. "We are only stopping jobs that will be done past our commitments in our current five-year statewide transportation improvement program."

The value of the contracts affected could vary between $20 million and $40 million.

At a loss

Springfield firms hit the hardest were Mathews & Associates Inc. and Scott Consulting Engineers, which are out a combined $720,000 in contracts.

Fred Mathews said his firm lost a $500,000 contract for initial surveying and conceptual work on the freeway upgrade of Route 60 between Springfield and Rogersville.

Mathews & Associates was a subcontractor on the $1.1 million consulting contract with Kansas City's HDR Engineering Inc. MoDOT staff has assumed the right-of-way planning that Mathews & Associates was performing. The firm had billed $100,000 of the work.

Scott Consulting Engineers is out of work on four projects totaling $220,000. The contracts with MoDOT's District 9 were out of its Willow Springs office, which is managed by Kerry Scott. Scott said only $30,000 was billed and the firm spent $20,000 in training and equipment upgrades to handle the work.

Since opening its Willow Springs office three years ago, Scott said the firm has billed $1 million in MoDOT's 9th District.

"I am disappointed because we depend on MoDOT a little bit," Scott said.

Even more so lately, according to president Dick Scott. The company designed five bridges for MoDOT last year, consuming 25 percent of the firm's workload, and hoped for future growth in the MoDOT arena.

Bracing for layoffs

Although no layoffs directly related to MoDOT's announcement have occurred locally, it is happening around the state, according to Bruce Wylie, executive director of the Consulting Engineers Council of Missouri.

"Some firms in Kansas City and St. Louis have already laid off staff because of these drastic contract cuts," he said.

Wylie said no totals were available, but he noted that $10 million worth of contract cuts is estimated to result in 100 layoffs. It's yet to be known, but as many as 400 consulting engineers in the state could be out of work when negotiations end.

The impact on Missouri's big city firms could haunt Springfield engineers, Wylie said.

"What I think the fear is especially with our firms in Springfield without (the MoDOT) market, a lot of firms in St. Louis and Kansas City will start looking for other markets," he said. Those larger firms could spread out to more rural areas and begin "competing with projects that perhaps Springfield firms didn't have a lot of outside competition for."

Local engineers understand the looming ripple effect, which could negatively impact the statewide industry.

"It is going to hurt us as a whole. There is just less work on the table for us to chase after," said Stacy Bergmann, manager of the Springfield office of Kansas City-based Harrington & Cortelyou Inc.

Like many, Bergmann is concerned for future work. The lack of transportation projects after voters buried Proposition B and the subsequent MoDOT announcement only further shrinks the contract pool.

"The prospects for getting future work are much dimmer than they were before Proposition B," said Brad Parrish of Palmerton & Parrish. Parrish said the firm recently completed a MoDOT project south of Joplin, escaping the contract cancellations.

Brad Tate, local office manager for Kansas City-based Affinis Corp., envisions another discouraging scenario: "Employees could leave and go to other parts of the country where work is and where people are willing to pay for roads."

That would leave the industry in a difficult position of decreasing projects coupled with limited employee resources, he said.

The famine

While the industry is scrambling, some find hope because MoDOT does not do in-house consulting work.

"I think MoDOT will be back using consultants in the long term because they don't have staff to meet all their needs," Mathews said. "The short-term problem they've got now is trying to finish what they've started and taking care of what they've got. I don't know how many years the long term is. That's the question."

It's a question echoed by others: "We don't know how long this famine will last," Bergmann added.